PETCO Slashes Return Rates with Bazaarvoice Ratings & Reviews™

Leading pet retailer finds that return rate plummets when a product
has reviews

June 26, 2007 09:05 AM Eastern Daylight Time

AUSTIN, Texas--(BUSINESS WIRE)--Bazaarvoice, the market and technology leader in hosted social commerce
applications that drive sales, today announced that PETCO Animal
Supplies has significantly decreased return rates by encouraging
customers to rate and review products on PETCO.com. On average, products
with reviews have a 20.4% lower return rate than products without
reviews. PETCO also found that the return rate continues to decline as
the product gains more reviews. In fact, products with more than 50
reviews have a 135% lower return rate than products with less than five
reviews. The significantly lowered return rate on products has resulted
in considerable annual savings for PETCO.com.

“According to our post-purchase survey data,
Ratings & Reviews are one of the online tools that most influence
purchase decisions,” said John Lazarchic, vice
president of eCommerce at PETCO Animal Supplies. PETCO, which
implemented Bazaarvoice in October 2005, is a leading specialty retailer
of premium pet food, supplies, and services. “This
new data is another sign that Ratings & Reviews are providing customers
with the information they need to make the right purchasing decision.
This is great news for our customers and a great business win for PETCO.”

“PETCO has one of the most active customer
communities on the Web,” said Brett Hurt,
founder and CEO of Bazaarvoice. “PETCO
customer reviews contain a huge amount of product information that
simply can’t be provided by a merchandiser
writing marketing copy. And the more reviews an item has, the more
likely it is that a customer will be satisfied with a purchase they make
online. Allowing customers to talk to each other and share information
helps online retailers like PETCO not only drive sales, but slash their
losses from product returns.”

According to a September 2005 survey by Internet Retailer, over
9% of online retailers have a merchandise return rate between 6 and 10
percent. Nearly 30% indicate that between 3% and 5% of the products they
sell online are returned. The average online retailer spends between $6
and $10 processing a product return. The result is that even a small
increase in product returns can lead to a significant cost savings for
an online business. By providing customer-created product information at
the point of purchase, Bazaarvoice Ratings & Reviews not only cuts
return rates, it also allows online companies to find out why a product
has a high return rate and adjust the marketing and manufacturing
accordingly.

“Retailers typically lack visibility into
return rates, especially for low-priced products,”
Hurt continued. “The returns process doesn’t
include a feedback loop and dissatisfied consumers will often share more
in a review, motivated to help their fellow consumer, than they will
with a cashier or on a form. Reviews give online businesses a digital
archive of the customer voice that they can take back to product
marketing and manufacturing to develop better products down the line.”

The reduced return rates are the latest in a string of Bazaarvoice
Ratings & Reviews successes for PETCO.com. Named PETCO.com Vendor
of the Year in September 2006, Bazaarvoice has helped PETCO.com
creatively use ratings and reviews content to increase the reach and
relevance of the customer voice through:

Email: PETCO realized a 5X increase in email click-through rates by
including relevant ratings and reviews content in the campaign
promotion.

Site Navigation: Top-rated products path featuring four and five-star
products in each category delivered 49% higher conversion and 63%
higher spend as compared to the traditional shopping paths on
PETCO.com.

Site Search: Searchers that sort by ratings spend 41% more than
searchers using conventional sort methods.

“PETCO truly understands the value of placing
the customer voice at the center of the shopping experience,”
Hurt said. “We’re
thrilled to continue to work together with John and his team to
facilitate and harness customer-to-customer interactions, which are
driving the shift towards social commerce as the new way of doing
business online.”

About PETCO Animal Supplies, Inc.

PETCO is a privately held specialty retailer that provides products,
services and advice that make it easier for our customers to be great
pet parents. We operate more than 850 stores in 49 states and the
District of Columbia, as well as a leading pet products and information
destination at www.petco.com. Our
nonprofit organization, The PETCO Foundation, has raised more than $34
million since its inception in 1999 to help promote and improve the
welfare of companion animals. In conjunction with the foundation, we
work with and support more than 4,200 local animal welfare groups across
the country to help find homes for more than 200,000 adoptable animals
every year.

Bazaarvoice was named a Red Herring Top 100 company in 2006 and received
the 2006 ClickZ Marketing Innovation of the Year award. Bazaarvoice
currently serves over 100 eCommerce leaders including Bass Pro Shops,
Dell, Macy’s, Overstock.com, PETCO, QVC,
Sears, and ZipRealty. The company has headquarters in Austin, TX and
offices in London, UK. For more information, please visit the company’s
Web site at www.bazaarvoice.com
or email info@bazaarvoice.com.